DNB Bank (DNB) M&A Announcement summary

Deal rationale and strategic fit

• Acquisition of 100% of Carnegie accelerates Nordic strategy, strengthens investment banking, asset management, and wealth management platforms, and increases focus on fee-based income.

• Combines complementary strengths and product offerings across Norway, Sweden, Finland, and Denmark, enhancing client solutions and Nordic market presence.

• Creates a leading Nordic player with expanded international reach via offices in London, New York, and Singapore.

• Deal is seen as a step change in rebalancing income mix toward fee-based revenues, with an estimated 30% growth in fee income.

• Both organizations highlight a strong cultural fit and mutual excitement about future opportunities.

Financial terms and conditions

• Purchase price is approximately SEK 12 billion, payable in cash, subject to adjustments and a normalized core Tier 1 capital ratio at closing.

• Transaction expected to close in the first half of 2025, pending regulatory approvals.

• Carnegie reported SEK 436 billion in AUM and SEK 535 million net income for the nine months ended September 2024; 2025 net income expected to exceed SEK 1 billion.

• Expected net income contribution to acquirer in excess of SEK 1 billion from 2025, with an earnings multiple of ~12x before synergies.

• Transaction is expected to be accretive to EPS and ROE, with a return on invested capital above 16% on a fully integrated basis.

Synergies and expected cost savings

• Main synergies are revenue-driven, leveraging broader product offerings and advisory capabilities across geographies and sectors.

• Efficiency gains anticipated across combined operations, with majority of benefits from growth opportunities and enhanced client offerings.

• Cost synergies exist but are not the primary driver; integration costs are expected to be lower than typical due to limited technological overlap.

• Majority of uplift to 15% ROIC is expected from revenue synergies rather than cost savings.